Monday, 19 October 2015

Spectacular U-turn for "next generation" technology

DOUGLAS SHEPHERD on how a 'winning' form of waste treatment fell out of favour almost overnight

Detailed work by Not Just Sheep & Rugby researchers has shown how bold claims about the technology which was to have revolutionised waste management for Scottish Borders Council (SBC) turned sour in a matter of weeks with Tory Government policy now blamed by its providers for making it an unattractive proposition.

A report written as recently as January of this year by directors of the NEAT Technology Group of companies boasted that they were at the forefront of advanced thermal waste-to-energy technology delivery. And, they claimed, the UK Government had implemented a range of support regimes to encourage new renewable energy facilities. SBC obviously believed them.

But when the continuing problems at the company's flagship Avonmouth Energy Recovery Facility (ERF) threatened to drain the lifeblood from the New Earth Renewables & Recycling Fund (NERR), which bankrolled Avonmouth's development, the script was swiftly re-written.

In a letter to stakeholders a few days ago, NERR's Michael Richardson declared: "In relation to the energy business, it was identified as early as autumn 2014 that major risks were posed by the increasingly bitter arguments within the UK Coalition Government at the time over the various support measures for renewable energy".

So it would appear some of the various businesses lined up to provide the Borders with an ERF for around £10 million were expressing doubts about the risks facing NEAT technology, and at the same time others were stating in their annual report: "Advanced thermal treatment of residual and commercial waste is considered to be the next generation of thermal treatment and can be applied to a variety of fuels."

That same report predicted £150 million of capital expenditure would be required to fund a second 13 MW ERF at Avonmouth, a 10 MW ERF at Canford, Dorset and a 4.5 MW ERF at Galashiels designed by NEAT. The development programme would generate in excess of £900 million in revenue over the next five years.

Shareholders and investors were told: "NEAT acts as New Earth Solutions Group's advanced thermal and technology provider and in due course will provide the same service to other third party customers. Strong and compelling market dynamics exist in the waste to energy sector, The UK represents a significant growth opportunity with substantial volumes of available refuse derived fuel (RDF) and a lack of thermal waste processing capacity".

An article published in the waste management trade press in 2013 said that before the ERF at Avonmouth was commissioned all of the RDF produced at the group's neighbouring conventional waste plant was exported to the continent, "which the company claims did little for the UK's balance of payments".

Contrast that with Mr Richardson's recent statement which outlined the continuing progress of NES' waste business in producing and exporting RDF to an increasing number of European customers at reasonably competitive disposal costs.

He added: "These off-take arrangements were proving to be more reliable and cost effective than sending RDF to the Avonmouth ERF, as it had struggled to maintain a consistent level of performance".

As reported here last week, the Isle of Man-based parent company of the various NES firms has now offloaded the entire energy sector to a bank in a deal which saw no cash change hands. The NEAT Technology companies, like those who operated the Avonmouth ERF, now have new names and new directors.

The technological problems and the cost of sorting them out have not been made public. But it will be interesting to see whether the flawed form of pyrolysis and gasification at Avonmouth, which so impressed Borders councillors and paid officials, can be made commercially viable in the future.